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story at Bloomberg:
U.S. oil demand fell to the lowest level in 16
years in 2012 as economic growth weakened while domestic [oil] output surged
the most in more than 150 years, the American Petroleum Institute said.
Total petroleum deliveries, a measure of demand,
dropped 2 percent from 2011 to 18.6 million barrels a day last year, the
lowest level since 1996, the industry-funded group said in a monthly
report today. Oil production increased the most since 1859 to the
highest level in 15 years, the API said.
“The demand decline is driven by the weak economy,”
John Felmy, chief economist of the API, said in a phone interview. “You
have weak gasoline demand, which is tied to employment and retail sales.
And you’ve got weak diesel demand that reflects a slowdown in the
manufacturing sector.”
Domestic oil production jumped 779,000 barrels a day
in 2012, or 14 percent, to 6.43 million, the API reported. A combination
of horizontal drilling and hydraulic fracturing, or fracking, has
unlocked supplies trapped in shale formations in states including North
Dakota, Texas and Oklahoma.
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